While it hasn’t been on the radar as a front-runner in the battle to legalize online gaming, Michigan just became the most recent state to attempt to establish regulations for internet gambling. State senator Mike Kowall has introduced the Lawful Internet Gaming Act (Senate Bill 889) in an attempt to protect residents who gamble online, generate revenue, and create jobs.
“In order to protect residents of this state who wager on games of chance and skill through the Internet and to capture revenues and create jobs generated from Internet gaming, it is in the best interest of this state and its citizens to regulate this activity by authorizing and establishing a secure, responsible, fair, and legal system of Internet gaming that complies with the United States Department of Justice’s September 2011 opinion concerning [the Wire Act],” the bill states.
The bill uses the successful New Jersey iGaming law as a model and aims to license and tax online games of both skill and chance. Delaware and Nevada are the only other two states that currently offer online poker, while Pennsylvania and California are currently the biggest battleground states fighting to legalize it.
The biggest roadblocks in these states have had to do with tribal gaming interests, a topic that is addressed in the Michigan law. While the bill says all existing land-based casinos are eligible to apply to operate online poker, if a tribal casino is interested, they must “waive their sovereign immunity for online gaming and agree to pay the applicable taxes.”
The Michigan bill also leaves the door open for shared liquidity with others states and nations, as the online poker industry in the United States tries to regain its footing since the passing of the Wire Act. Currently, Nevada and Delaware share player pools, but this is the first time U.S. gambling regulations have pursued the idea of international sharing.
Michigan, the tenth-most populous state, is currently one of just three states that offers legal online lottery sales, and one of only two which allows the sale of online instant-win lotto games. Because the state legislature already has some familiarity with online gaming, Kowall hopes his bill will move through the senate by the end of this year.
The bill would prohibit Michigan citizens under the age of 21 from gambling online. It would also require a $5 million licensing fee from operators seeking approval and a ten-percent tax would be applied to gross gaming revenue.
(Photo credit: senatormikekowall.com.)
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